Scott Miller

I'm Scott.

Bill Reinsch

I'm Bill, and we're the Trade Guys.

Alex Kisling

You're listening to the Trade Guys, a podcast produced by CSIS where we talk about trade in terms that everyone can understand.

Bill Reinsch

I'm Alex Kisling, and I'm here with

Alex Kisling

Scott Miller and Bill Reinsch, the CSIS Trade Guys.

Scott Miller

This is Trade Guy Scott. Thanks for listening to the Trade Guys. This week's episode, we have two special guests, Sumayya Keynes and Chad Bone, who have just published a new book called how to Win a Trade War. Sumayya is a journalist and Chad is a researcher and trade PhD, and the two of them together have produced a very entertaining and wise book that I think you'll like learning about in this episode. So thanks for listening and stay tuned to the Trade Guys.

Bill Reinsch

Hello, listeners. Trade Guy Bill, back with Scott and two distinguished guests, which I'll get to in a moment. For this week's podcast, I do want to alert everybody to a slight adjustment in what we promised you last week, which was that next week, the week of Memorial Day, we would devote another of our podcasts with a guest on talking about USMCA. We subsequently discovered that the USMCA talks are going to be next Thursday and Friday, May 28th and May 29th. And so we thought it was poorly timed to do a podcast in the middle of the talks on that subject. So we'll be back as usual, but it will be a different subject and we'll do our guest USMCA podcast the week of June 1st, probably early that week. So while everyone remembers whatever it was that they discussed on Thursday and Friday, this week, we're going to do something different. We have two guests on it who are also podcasters, tempted to say competitors, but certainly friendly competitors, but also authors of a book. And they are Sumaya Keynes and Chad Bowne, who have written a book, how to Win a Trade War. It'll be published right after Memorial Day. I'm tempted to say it's a sequel to Trump's book, How to Start a Trade War, but I don't think that was actually the title of his book, but that's more of his policy in his book. It will be, I think, a distinguished addition to the literature on trade. I've actually read it, believe it or not. It's an easy read, listeners. It's a fun read, and it's not a doorstop. It's only 221 pages, unlike many books about trade. And so I highly recommend it as a very interesting thing to start your summer reading off, even at the beach you can enjoy reading this. Not this weekend is going to be much good at the beach, I don't think. But anyway, our two guests are the authors of the book and they are Sumaya Keynes, who is an economic columnist at the Financial Times and host of her own podcast, the Economic show with Sumaya Keynes. Before joining the ft, she spent eight years at the Economist doing commentary and analysis there. And she also co founded another podcast, Trade Talks during the Trump administration's First Term, which she co hosted with our other guest, and that is Chad Bowne, who is a Reginald Jones Senior Fellow at the Peterson Institute for International Economics, one of the longer titles of anybody we've had on the show, and host of the Trade Talks podcast. He also has distinguished himself with public service on the behalf of all of us, both as chief economist at the State Department during the last administration, the Biden administration, and as senior economist in the White House and during the Obama administration Council of Economic Advisors. And one of the stories in the book details part of his experience as at CEA in the Obama administration, where he had to explain supply chains to the president and many other people who probably at that point in time, just right after the Fukushima earthquake in Japan, when supply chain suddenly became a big topic for a lot of people, something that I suspect not a lot of people in the White House at that time had given a lot of thought to. And Chad may end up getting into that today as well. Prior to that, he was on research staff at the World bank and the WTO and the faculty at Brown Dice, where he was a tenured professor of economics and gave all that up for public service. And we congratulate you on that. So let me start off with the usual softball to Chad and Samaya. You guys decide who wants to go first, why do you write it and what's your basic message?

Sumayya Keynes or Chad Bone

In a nutshell, we wrote it because trade wars are in the headlines, right. And we thought that there was a lot of yelling out there and we wanted to write the how to guide for fighting a trade war, even if you don't want to be fighting a trade war. Right. So it's a nuance filled explainer of where we are in this kind of crazy moment in the global economy. And also the explainer of, you know, what is specific to Trump and what's not specific to Trump. So what are the problems with the trading system that are going to outlast this president? And yeah, so the book is that how to Guide. And you know, there are a few messages of the book one is that if you want to win a trade war, then you need to learn from the other teams. There are lessons from China that we can learn, in some cases what not to do, but in some cases, they have learned lessons that we should internalize. Just to give one example, when they think about state intervention, they think about both demand and supply. So this is one of the challenges that the Biden administration faced when trying to build the chips industry in the U.S. right? They really focused on supply, right? Getting more factories, fabs in the U.S. but that demand side signal wasn't necessarily necessarily the strongest, Right? And so you, you know, you had intel that was struggling to find customers because it was struggling to compete. So, you know, there are better and worse ways of doing that, but we should be looking out to the rest of the world to see what lessons you can learn. And then, you know, the other main lesson of the book is that trade wars are like real wars and logistics win real wars. So if you want to win a trade war, there are no shortcuts, right? You've got to do the prep. You've got to do your homework. You need to build your defenses, subsidize stockpile, identify your vulnerabilities before you can, you know, run into battle. Brandishing tariffs and export restrictions.

Alex Kisling

Part of the reason why I was so excited to work on this book when my longtime podcast partner, Sama Keynes suggested it to me a year ago was, you know, I had just come out of, as you mentioned, the Biden administration, and the world had changed dramatically. I had been, as you said, the Council of Economic Advisors in the Obama administration. And that was kind of the height of globalization, when trade was good and it wasn't too much public pushback against that. But this time around, my service in government was fundamentally different. And yes, of course, we've got tariffs, right? President Trump makes tariffs. A news headline every single day. But when I was in government, it was also using a lot of these tools that Samayya just described. It was, how are we going to do industrial policy better, whether it was for chips or for electric vehicles, batteries, critical minerals, how are we going to do export restrictions, you know, with partners and allies, stockpiling? Oh, you know, we haven't done that in a really, really long time. Seems like something we need to be worried about. Anyway, those were the first order questions that I was working on day and night on in this job. And there really was no guidebook for how to do this. We had been taught for, you know, my entire career is follow the Rules based trading system.

Sumayya Keynes or Chad Bone

Right?

Alex Kisling

And that's what everybody's going to be doing that no longer exists. We're all doing this kind of stuff now. And so what Samayya and I have tried to do in this book is to present a guide based on what it is that we know from economic evidence, from history, learning from each other, good and bad things, how it is in this new environment when you're fighting trade wars, how to wield these weapons to give yourself the greatest possible chance to succeed. Because unfortunately today, while the old trope is nobody wins a trade war, that's not an option. We all have to engage. And so we've got to do it as smartly as we can.

Scott Miller

I also had a chance to read the book and I do appreciate that opportunity. And I observed in the first section of the book, the preface, essentially that you had an elegy for, for the World Trade Organization, which I thought was an artful way to put what we're all feeling. Most of us who are professionals in this space understand and for many years relied on the rules based system of international trade as expressed in the WTO. But you're right, it's ran out of steam about 2008 or so, if not before. And like a lot of the post World War II institutions, no longer is really delivering and creating the meaningful kinds of outcomes that at one time we could rely on, given the fat's missing. I did observe in the rest of the book as if there's an empty chair at the table. It's the Passover dinner with the empty chair for Elijah, and Elijah is in this case the rules based trading system. What do you think we're doing now that it no longer essentially is the arbitrator of actions? And how many fumes are we still inhaling in this space?

Sumayya Keynes or Chad Bone

Maybe I should push back slightly or, you know, I guess adjust from what has been said before, which is rules clearly are underpinning a lot of trade going on out there. Right. So I don't want to say it's completely dead. It hasn't been killed by everyone. Right. It just so happens that some of the world's biggest and most important players are doing what they want. Right? President Trump isn't going to be influenced by whatever some lawyer in Geneva says. But, you know, I think a lot of other governments still do see some value in those rules. So I don't want to overstate the extent to which the rules based system is dead. You know, I guess I worry that we are only at the beginning of the the journey in terms of understanding what the erosion of that rules based system means. So, you know, obviously the big question right now is around the world, I think other governments are waking up to the challenges of China and they're trying to work out how to defend themselves. And so the big policy question is, are they going to defend themselves only against China or are they going to take that opportunity to defend themselves against everyone? Is the kind of protectionism going to be catching, basically? And you know, under a rules based system, there are supposed to be constraints on that. I think what's going on in Europe is really interesting because there, I think there really is that commitment to the rules based system. I think they're the kind of most devastated that the rules based system isn't working because they operate based on rules. That's their love language. And you know, there are too many of them to be able to make quick decisions in a world of geopolitical battles. So they really want that rules based system to come back. And so they are trying to, you know, react to China in a way that is consistent with at least the principles of that system. There's been some discussion about mfn. I think they trigger the national security exception to handle their trade deal with Donald Trump. We'll see what happens there. Maybe that's a precedent that could allow them to put up restrictions against China. But I suppose there are some efforts to try to make consistent the protection against China with some of what is left of that system. And there are many, many policymakers, I'm sure, who listen to this podcast, thinking we're still here, we're still doing some stuff. It would just be nice if the US and China paid a bit more attention to us.

Bill Reinsch

I was interested in a couple of your comments. One about demand and supply issue. This is something we've noted in the past, and I think that this was true in the Biden administration. But it's a broader issue than that. In looking at a variety of trade issues, we found an awful lot of information about supply and a lot of analysis about supply and relatively little about demand. Chips being a good example. We've done some research in that area and at one point convened a meeting of a whole bunch of people that actually make them from different companies, both American, European and Asian. And what we discovered is they didn't know what was going to happen either, which was a little bit disconcerting. And they all had a really good sense of who was making what and in what quantity. But they didn't have a very good sense of who was buying what and in what quantity and what their forecasts were. To the extent we could squeeze forecasts out of them, they were all over the map. So clearly an area for real economists, unlike Scott and me, to do further research. I may be the last one, but I'm more optimistic than the book. And your last comment sound a little bit more optimistic than Chad. But I think that one of the things the book notes, which we've noted too, is that Trump is doing what he's doing and the Chinese are doing what they're doing, but everybody else is doing a bunch of things that are actually surprisingly conventional. I mean, the message from Trump has been we're not a reliable partner anymore. So what are people doing? They're finding other partners. The eu, the ASEAN nations, India, they're all negotiating with each other without us and without China for the most part, for that matter. The EU concluded one with India, they concluded Mercosur. After 20 years of negotiating. I mean, you can make a good case that actually Trump is stimulating this activity. But what I thought was interesting, and the question I guess is agree or disagree is the kind of things they're negotiating strike me as surprisingly old fashioned. You know, their market access, tariff lowering, market opening, barrier reducing, traditional agreements, they just don't include us and they don't include the Chinese either. Now, those are big exceptions, but I would make the case that there are more than remnants. There's a significant part of the system that keeps lumbering on despite all the problems. Am I wrong about that?

Alex Kisling

No. So, I mean, I guess I would react in maybe two ways. You take a country like India, right, And what India has pivoted toward in the last couple of years with new deals, you know, sort of first with Australia, Switzerland, smaller economies, but more recently with Europe. In the UK right now with India though, it does make sense to negotiate over traditional trade barriers like tariffs because its tariffs are still really high. Right. So that kind of getting a traditional deal with them, if you could get it, that's great, right? That's what you want to do. I think with the other economies, we'll see how impactful things are when MFN tariffs between Europe and the CPTPP economies, for example, Right. And they're in conversations together, those tariffs are already really low. It's not clear how much additional tariff cutting between them is going to matter. New rules, okay, maybe they'll help facilitate some trade. But if you're seeking to make a major difference in terms of addressing some of the current challenges out there and I think the big one, stepping back from President Trump in the United States at the moment, the big challenge for Europe, as Samaya indicated, really is China. And especially given the fact that the United States, because of our tariffs toward China, Europe is seeing a flood of imports into their market. China's moving technologically up the ladder. And so they're finding it more difficult to compete both in China and in third markets. China is a huge deal for Europe at the moment. The only way they can really address that, given that the MFN tariffs are relatively low, is to raise barriers toward China. And so what's interesting to watch is how they're doing that. Right. And as Samiyah indicated, they're trying a rules based approach. Not sure all these things that Europe is doing is going to be consistent with WTO principles. At the end of the day, if somebody were to try to litigate them in Geneva, they've got the foreign subsidies regulation, they've got this new rule that they're trying to convince their domestic industries to diversify, to only allow them to have, you know, 30, 40% of their sourcing being from a country like China, to force them to source from other places. Not sure how WTO consistent those kinds of new rules would be, even though Europe is trying to adopt them. So in any case, I don't disagree with the general thrust, but how effective that thrust is ultimately going to be if it ignores the elephant in the room, which is China, I think is still to be determined.

Sumayya Keynes or Chad Bone

Just to clarify, I think the EU is only discussing some of those rules rather than actually kind of made them formal proposals. So this is still an area that's totally in flux.

Bill Reinsch

It'll be interesting to see how the EU proceeds. May a good point about their focus on rulemaking and their interest in making sure there are rules and adhering to the rules, which is something that we've noticed too. I can't resist pointing out that they also have a convenient habit of trying to tilt the rule in ways that favor them.

Sumayya Keynes or Chad Bone

Doesn't everyone?

Bill Reinsch

Well, yeah, they're no better than anybody else. Well, I mean, they maintain they're better than everybody else, but a lot of what they've done in the rulemaking phase is really, I think, designed to force other countries to adopt their rulemaking approach if they want access to the European market, which actually goes back to something that Chad said. I'm tempted to say this is all fiction because it never happened. But the right answer to the problem that Chad just described, the problem of China, I think might have been t Tip. Because the Obama concept was let's create a giant market of the two biggest developed entities in the world, the EU and the United States. And let's set the rules and essentially say that if you want to access those markets, you have to do it our way. That didn't happen. And so here we are.

Sumayya Keynes or Chad Bone

I mean, even if you had had those, I suppose the question is though, what inducement would China really have had? Right, because they already had pretty good access to both of those markets even if they had done a trade deal between them. So maybe ttip. But wouldn't you also have needed an extra, some kind of wall? I'm not sure that carrot would have been big enough basically.

Scott Miller

Well, the other option is always to speed up liberalization. Look, China was going to be a problem anyway. It became a problem faster because the United States stopped being the importer of first resort. So imports are going elsewhere. But China has a very different economy. As a large economy, internal consumption is what, about 40% of GDP. In the United States and Europe it's 70 or 80% of GDP. So there's a missing internal economy when China enters talks. And so there's instant overcapacity in exports because here's a big partially developed economy still trying export led growth. That force alone is disrupted. Now what is missing from the developed economies is a further round of liberalization that would accelerate economic progress at home. It's all around second acts are really hard. NAFTA was a vitally important integration of North America. The single market in the EU was probably the most beneficial policy ever enacted in the history of the European Union. The single market did more good for more people. And yet in both cases of the NAFTA and the EU single market, there's no second act. We never really got around to agriculture or services in the EU single market. We never took North American free trade in a direction of greater liberalization, greater energy and greater partnerships that produce competitive advantage. So why are second acts so hard?

Alex Kisling

Well, I think partially it's you're getting into the really, really difficult behind the border stuff, which is now no longer just let's exchange a tariff cut for a tariff cut, but let's figure out how to make, you know, harmonize our regulatory systems and make products, mutual recognition, things like that, and free movement of people. If you're talking in the area of services, perhaps. And that's just really, really, really, really difficult because there's a lot more autonomy and sovereignty that policymakers have to be willing to give up. I do want to say One other thing about China though, which is don't disagree with how you've characterized it at all in terms of, I think that's probably 80% of the arguments. Their economic system is different. They not a big enough consumer. This is big macroeconomic challenges. And you know, and we address that in the book as well. But the other fundamental difference about China that really I think doesn't get enough airtime is dating back to at least the Made in China 2025 program or the dual circulation program. This decision that China was going to focus its supply chains on having the rest of the world become dependent on China and it not having a dependence on the rest of the world for its supply chains. Right. Which just fundamentally sends a signal that we don't actually believe in this interdependence that is the fundamental underpinning behind a rules based kind of global trading system. And if that's there, it's really hard to get away from that. If a country is seeking to establish dominance and then it's showed its willingness to weaponize it. Right. And we all saw what happened last year, whether it was rare earths, permanent magnets, the Nixperia chips. Right. The rest of the world has to take that kind of thing seriously. And so this then moves beyond a conversation about the trading system and rules and subsidies and current account imbalances and something like that to another area entirely, which unfortunately has come into play.

Bill Reinsch

I'm inclined to agree with that. And one of the things we've noticed is something that Samea said in her beginning comment, which is the rest of the world's catching on. I mean, this is not a new problem for the United States and it's now a big problem for Europe. But you see other countries, India, Turkey, South Africa, even Brazil, Mexico, Canada, taking or contemplating taking adverse actions against China on various grounds. Indonesia is another one. This is disorganized. They're not all doing the same thing and they're not doing it for the same reason, the same time or the same magnitude. I mean, there's a golden opportunity here for global leadership to create a united front. But Biden didn't do that. And Trump of course, is not going to do that because he's not fundamentally a multilateralist. So what you've got is exactly what Sumayya said with respect to Europe. You've got individual entities taking actions against China. But the world is kind of waking up to exactly the set of policies that Chad described and I think are deciding that it's not consistent with their vision. Vision of how the global economy ought to operate. So here we are. It may well be that that leads to the rest of the book, which is how to win the trade war, because it may be inevitable that we end up in one. Next question. Let me refocus a little bit on the United States and ask you kind of different question. One of the points you make in the book is the backlash against trade, and I don't disagree with that, that that's happening. There clearly is one here, and I think you've probably seen it in other countries as well, which leads then to, you know, some of the various protectionist tools, use of those tools that you describe in the book. But one of the things that I think Scott and I have always found interesting about American public opinion when it comes to trade, and the Pew Research center has been asking questions about this in polling for at least 15 or 20 years, is that Americans have opinions about trade. You know, if you ask them about trade, they'll tell you what they think. And, you know, they, for the most part, are pro trade goes up and down. Democrats currently more pro trade than Republicans. But that hasn't always been true. That's the way it is right now. But to me, the telling statistic is when Pew asks a different question, which is, what's important? What do you care about? And the scale is different. Sometimes it's 12, sometimes it's 8, sometimes it's 13, sometimes it's 18. Choices. Trade is always at the bottom. Invariably one year it moved up one. Climate change was at the bottom, but for the most part, trade is at the bottom. And what is at the top right now, interestingly, the economy, of course, is at the top. Healthcare is at the top. The other one that currently is number two is corruption and money in politics, which is the first time that one showed up. In the past, it usually was terrorism. But trade's at the bottom, which ends up suggesting, at least to American politicians that while Americans have opinions about trade, when they step into the voting booth, they actually are thinking about other things. And so you can pretty much do what you want on trade and get away with it, because it's not one of those issues that really motivates people to change their views about people they're electing. And so there's in a way, there's a backlash. People will say nasty things, but I'm not sure how much they really care about them. And you guys have a different view about that.

Sumayya Keynes or Chad Bone

I mean, who among us having this conversation hasn't questioned their life choices? Specializing in A topic that no one really cares that much about. So people do care about prices. Right. People do care about affordability. Right. And actually, one of my concerns is that the anger about affordability is going to really constrain politicians ability to sort of do the right thing when it comes to some of the kind of decisions that I think need to be made in terms of diversifying away from China. Because, you know, these decisions do have consequences in terms of cost. I think there's also some really interesting academic evidence that, you know, at the margin, there are cases where, so a group of researchers looks, looked at what happened after Trump's first term tariffs. They found no effect on jobs. They couldn't find that those tariffs had raised, you know, manufacturing employment in the areas that were affected by the China shock years earlier. But they did find that actually it was associated with an increase in support for the president. Right. And the message from that is that you can have, in certain cases, you can have opinion divorced from the economic reality on the ground. You'd like to think that there is a very strong connection between, you know, the economic facts of the tariffs and how people feel about them. And if there isn't, then, you know, people's opinions are malleable. I think another really interesting facet of the polling is that people's opinions on trade tend to change based on who's in power. So Republicans become much more comfortable with trade when their guy is in charge. So, yeah, I think acknowledgement that trade isn't necessarily at the top of people's agendas when described as sort of trade policy. Although I think the lesson of the last year or so is that people are learning that actually trade policy does have implications for other things that they do care about more. And I'm pretty sure they'll be unhappy about it if the US Finds itself on the bad end of an economic spat where actually suddenly you can't buy a car anymore because there are no more, because the components aren't available, or any other number of tronic devices.

Scott Miller

Well, cognitive distance is a real thing and that's what you see in almost all polling. That's what's behind the Pew Research findings, where people will have opinions about it, but they focus on what's most important to them. That's also true about politicians. And one of the things that I remember on the 2016 campaign trail, she was then reporting for the Pittsburgh newspapers. Selena Zito had the famous observation of Donald Trump's supporters take him seriously, but not literally. His opponents take him literally, but not seriously. And cartoon. Donald Trump is a lot of fun. And we owe our existence as the trade guys to Donald J. Trump because he put this matter in front of the American people so routinely and started talking about things that had only been in the business section before that. It needed an explainer. It needed us to talk about this in plain language. Part of the plain language of Trump is he's using tariffs for other purposes. He's a negotiator by his very existence. And he tends to see things transactionally, which if you spent 40 years in real estate, you'd see things transactionally. And he uses it for lots of reasons other than trade protection. But he talks about it in shorthand. I think what the guy really wants more than anything else is he cares about the productive capacity of the US Economy from a geopolitical standpoint. It's very important to him that the US have the kind of economic strength that will allow it to survive in these rough waters. And he seldom says exactly that. In fact, often says the contrary, which makes it difficult to filter out. But he uses trade and tariffs in particular in a lot of ways that are just novel for presidents, but not necessarily wrong or ill timed for the moment. So let's say he had a legitimate objective, which is to improve the productive capacity of the United States. What would the pro traders like the four of us be recommending versus what's going on now?

Alex Kisling

Well, I think that's part of what we try to do in the book is to say, look, there are cases where a targeted, reasonable use of tariffs may be the instrument that you have to use to move these supply chains, to create the incentives for companies to not be so reliant on China and to do something else. Right? To shift away and find some alternative source. Tariffs are a part of that picture, as are things like subsidies, industrial policy, stockpiling in the short run to get you through situations where you might have potential shortages and things of that nature. But you can't at the same time use tariffs for that purpose and try to achieve 17 other objectives as well. Right. Because each time you're using tariffs for that purpose, you're taking it away, the main thing that you need to be worried about. So when you're fighting a trade war, you've got to decide what your priorities are and you've got to focus on that. And I think one of the challenges with President Trump is sometimes he says this, sometimes he says the opposite. And he's said at least half a dozen reasons for why he's using the tariffs.

Sumayya Keynes or Chad Bone

So we have a whole chapter on subsidies in the book. There's a culinary theme in that chapter, right? So all the lessons in that chapter are based on the theme of cooking. And the reason we picked that is because we're both horrific at cooking, right? Chad has made the worst gluten free apple pie I've ever tasted in my life. Takeout is my preferred form of cooking. And you know, when it comes to subsidies, we need a huge amount of humility, right? We don't have a lot of practice doing these things. Well, we have a lot of examples where they're very wasteful, where we did it wrong. And the kind of the recommendation after that was, well, just don't do them. And actually we need to do better than that. We need to get better. And just building on what Chad was just saying, one of the first lessons in that chapter is don't put fish in a fruit salad. Which is literally something that happened to me. I was once at a lunch and the guy I was having lunch with, it was like a salad bar and he just put some mackerel on top of his fruit salad. And I have no idea what happened at the rest of that meeting because all I was focused, focused on was the fact that he put mackerel on his fruit salad. But that lesson is important if you're trying to say, you know, this was an issue, again with the chips act, you're trying to get fabs in the U.S. you're also trying to jump over every single environmental hurdle that there is. You've also got local labels, you've got, you know, you've got all these other objectives which are good, right? None of these objectives are bad. But if you try to add too many ingredients to your meal, you're not going to have a successful meal and you're going to distract from the purpose of the meal.

Bill Reinsch

One of the entertaining features of your book is the tendency to use very extended metaphors.

Sumayya Keynes or Chad Bone

Tortured, some might say cooking is one of them.

Bill Reinsch

Personally, I preferred the one about the teenage kids having had teenage boys, in my case myself, one of whom was higher maintenance than the other. They're fun metaphors. And I take the cooking one. I think maybe the lesson in all of these, and I mentioned another one of your stories is not so much be careful what you wish for, but have pretty clear objectives in mind and try to figure out a way to make sure that your tactics you're using, the tools you're using, are going to achieve your objectives. One of your stories that you cited was for me anyway, Famous Toshiba case, the one with the radio bashing on the Capitol steps. I happen to have been directly involved in that. Not in the radio bashing. That was a House of Representatives issue that characterizes the House. I was working in the Senate at the time, which didn't then descend to things like radio bashing with a sledgehammer. But my boss was really the main author of the sanctions bill that resulted from that, that passed, was signed into law. We all patted ourselves on the back for the good work we did, punishing various parties for this breach of sanctions that enabled the Soviet Union at the time to make quieter submarines, which is what you said it was all about. What your story didn't pick up, though, was the aftermath. If you look at what actually happened in that case, the sum total of what that legislation did was we put one United States citizen out of business, and unfortunately, he was one of our constituents. So we heard about it at great length. Very nice man. But we put the company he worked for, which was the Toshiba Machine Corporation, effectively out of business in the United States. One guy. Now, I am told by others that what we did actually had an impact in Japan and pushed them to clean up their act, which was where the real problem was. So maybe it did some good. But if the idea was we're going to punish American miscreants for this horrible thing that happened, and we didn't really do that, and Senator Hines lost a voter in the process, which I've always regretted.

Alex Kisling

Yeah. The point of that story, and that's amazing, Bill, your front row seat during that episode was to really show just how difficult it is to coordinate when you're doing export controls. Right. So in that instance, it was trying to not allow the machine tools that the Soviet Union needed to make quieter submarines. Right. That were primarily made by Toshiba and, you know, some CNC machines, I think, from Norwegian company, how to prevent those, all those things from getting to the Soviet Union. And it's really difficult when you're using export controls to coordinate. Even your partners and allies, when there's profit opportunities to be made, you really, really do have to work together, because nobody likes export controls. And I think that's the big message from that story.

Scott Miller

Well, look, this has been a fun episode, all right? And we thank you for coming on. We thank you for writing the book. And for those listeners who haven't gotten the point out there yet, this is an entertaining, enjoyable read. And there's real wisdom in the book. Well worth your time. And you're our guest we'll give you the last shameless plug on where to find the book and how to buy many copies. Go right ahead. But thanks for coming on and thank

Sumayya Keynes or Chad Bone

you so much for reading it. I really appreciate it. I'm so glad that you enjoyed it. And yes, it is beach reading that is the main message and not just for trade nerds like us. And yeah, just buy it wherever you get your books. It's available everywhere. And if it's not, then demand that it is stocked at your local bookshop.

Alex Kisling

Yeah. And it's how to win a trade war. It's available everywhere. But it really is not just for us trade nerds, but it's to the trade nerds to give to their non trade nerd family members, their friends to explain to them what it is that all of us are actually confronting right now so that they have a little bit more empathy for the world that we're trying to engage in.

Scott Miller

Thanks again for coming on the show.

Bill Reinsch

Yes, thank you.

Sumayya Keynes or Chad Bone

Thanks for having us.

Alex Kisling

You've been listening to the Tray Guys, a CSIS podcast. For more audio content, visit csis.orgpodcasts thanks for tuning in.